CAVA beats Street estimates in fiscal Q1

Cava Group Inc (NYSE: CAVA) is trading down in extended hours on Tuesday even though it reported market-beating financial results for its first quarter.

Why is CAVA stock down in after-hours?

The price action is interesting considering the management raised its guidance as well. $CAVA now forecasts up to $105 million of adjusted EBITDA on 4.5% to 6.5% of same restaurant sales growth in fiscal 2024.

The New York listed firm expects to open up to 54 new restaurants in total this year. Brett Schulman – the chief executive of Cava Group said in a press release today:

The Mediterranean food chain opened 14 net new restaurants in its recently concluded quarter. Cava stock has roughly doubled year-to-date.  

CAVA Q1 earnings snapshot

• Earned million that translates to 12 cents a share
• Had $2.1 million loss ($1.30 per share) last year
• Adjusted EBITDA printed at $33.3 million as per the earnings report
• Revenue jumped 30.3% year-over-year to $256.3 million
• Consensus was 1 cents a share on $237.16 million in revenue

Cava Group improved its profit margin by 280 basis points (sequentially) to 25.2% in Q1. CEO Schulman also said on Tuesday:

Wall Street currently has a consensus "overweight" rating on CAVA stock.